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tate oil and gas firm PT Pertamina is pessimistic that its oil production this year would reach the target of 208,000 barrels per day (bpd). As of the third quarter, production had only totaled 191,000 bpd.

However, the company promised that it would take all necessary measures to ramp up production to reach the maximum amount.

The best estimates said that assuming the West Madura offshore block could produce more than 20,000 bpd in the fourth quarter, Pertamina’s production would hit 195,000 bpd by the end of this year.

“Our oil production will likely miss the target, but the natural gas production will exceed the target,” said company vice president for corporate communications Mochamad Harun.

Company data shows that in the first nine months of 2011 Pertamina’s gas production reached 1,510 million standard cubic feet per day (mmscfd), higher than the target of 1,450 mmscfd.    

Harun reported that Pertamina, through its two upstream business units, Pertamina EP and Pertamina Hulu Energi, had applied the enhanced oil recovery (EOR) technologies at its nature wells, however, the results might not come directly this year.

“EOR is for the long term,” he said.

He continued that additional production from drilling more wells was also not as expected.

The company is dealing with many “classical problems”, such as late permits and difficult land acquisition processes to execute drilling plans, he added.

“Our declining production rate is still high, around 18 percent per year. We’re trying our best to keep the decline from falling further,” Harun said.

Pertamina EP said it expects its production would only hit 126,000 bpd this year, lower than the target of 132,000 bph.

Upstream oil and gas regulator BPMigas head Raden Priyono also reported that Pertamina EP lost a huge amount of oil due to non-technical problems, such as the delay in permit issuance and land acquisition.

Problems in land acquisition had caused the company to lose 200 bpd of oil, while problems related to the delay in location permits cost PT Pertamina EP ‘s Pondok Makmur unit 4,000 bpd and Joint Operating Body (JOB) Pertamina-PetroChina East Java 3,000 bpd.  

BP Migas had also urged Pertamina to revamp operations of 5,000 older wells and 50 idle wells scattered across the country. Those fields were estimated to have the potential to provide a total
contribution of 200,000 bpd to the company.

Pertamina currently holds 141,000 square kilometers of oil and gas fields nationwide, the largest among production sharing contract (PSC) holders in Indonesia.

The company’s data showed last year that the firm produced 190,000 bpd, an increase of 2 percent from 186,000 bpd in 2009.

Indonesia desperately needs to ramp up its declining oil production. In 2010, the country produced 954,000 bpd, falling short of its target of 960,000 bpd. Achievement this year is even grimmer, with a production rate of only 905,000 bpd, far below the revised target of 945,000 bpd.

Prior to the revision, the country aimed to produce 970,000 bpd. Next year the government has set a target of 950,000 bpd, a goal the Indonesian Petroleum Association (IPA) views as “challenging”.